Public hearing on power rate hike starts today

CEBU, Philippines -The Energy Regulatory Commission will conduct a two-day public hearing starting today on its approval of a provisional power rate hike nationwide.

In Visayas, the jurisdictional expository and pre-trial hearings will be held at 9 a.m. today while the evidentiary hearing will be held on March 20 from 9 a.m. to 5 p.m. at Holiday Plaza, F. Ramos Street, Cebu City.

Last February 16, the ERC provisionally authorized the National Power Corporation to increase its basic rates by an average of P0.4682/kWh for Luzon; P1.1460/kWh for Visayas; and P0.7147/kWh for Mindanao.

Power rate in the Visayas has increased by P1.1460 per kilowatt hour, making it P4.0339 per kilowatt hour from P2.8879 per kilowatt hour starting the February 26 to March 25 billing of NPC.

As a result of such provisional increase, the Visayan Electric Company Inc. announced yesterday that starting next month, power consumers in Metro Cebu will pay an additional 90 centavos (or P0.9346) per kilowatt-hour as it implemented a rate increase following NPC’s hike in generation charge.

VECO will start increasing the rate adjustment by April, although the ERC still has to conduct a series of public hearings on this matter. The ERC, however, said that the provisional rates may still change depending on the outcome of the hearings.

The ERC pointed out that if it turns out during evaluation that NPC and the Power Sector Assets and Liabilities Management Corporation are not entitled to the provisional adjustments, they are obligated to refund any excess in recoveries.

As ERC holds a public hearing today, representatives from local government units in the Visayas, cause-oriented groups and electric cooperatives will challenge NPC’s petition for rates increase.

Lito Vasquez, secretary-general of Freedom from Debt Coalition (FDC) Cebu, and officials from FDC chapters in Eastern Visayas, Negros and Iloilo will come to Cebu to join the protest action against the rate increase petition filed by NPC and PSALM.

In a press statement, ERC said that the provisional rate increase is intended to immediately alleviate NPC’s current financial difficulties given its current costs of generating power and the discounts that it is mandated to extend to certain customers.

Vasquez said the NPC is raking in billions from its present rates yet it demands billions more in the middle of a raging worldwide crisis.

Vasquez said that based on NPC’s 2007 Annual Report, the utility firm declared that it “closed the year with an unprecedented net income of P136.07 billion,” the highest in NPC’s “71-year corporate history.”

FDC had argued that NPC’s proposed return on rate base (RORB) increase from 8% to 12% is vague, whimsical, and without factual and legal basis. — Mitchelle L. Palaubsanon/LPM (THE FREEMAN)